TCI: Transportation & Climate Initiative
David Blackmon, Oct 24, 2019
A gasoline tax by any other name is still a tax on gasoline, isn’t it? That’s the question the governors of a dozen Northeastern states are attempting to avoid by implementing what is effectively a new gas tax on consumers via a regional “cap and trade” system.
The concept at hand in this regional gas tax scheme is similar to every other “cap and trade” system devised in any free economy, which involves the politicians trying to hide the tax from consumers by placing the point of taxation upstream, in this case with gasoline wholesalers. The Politico story linked above reveals that fact in the following paragraph:
"For the average consumer, the program will function fundamentally as a gas tax, as fuel wholesalers paying for emissions allowances pass on those costs. But policymakers prefer the term "cap-and-invest," and argue that the benefits of greening the transportation system will limit the cost impacts and keep energy dollars in the region."
How TCI Works
TCI is a form of carbon-taxing scheme devised by 12 northeastern states plus Washington DC designed to increase the cost of driving for consumers so that they use less gasoline and diesel, by switching to electric vehicles (EVs), mass transportation, bicycles and walking.
Simply put, TCI forces companies that sell gasoline to buy so-called credits at auction. These credits are generated by renewable energy sources. For example, a gasoline distributor in NY or CT can buy wind credits from California or solar credits from Oregon. The amount and price of credits distributors have to buy increases over time. Naturally, these distributors pass on the cost of the credits they have to buy to their customers, as described in the Forbes article above. And these costs will increase as distributors have to buy ever more expensive credits over time. That means the cost to drive your car will increase as gas prices go up, to the point that you can no longer afford to drive your car, which is what the regulators want. They want to completely eliminate the sale of gasoline, starting in the northeast, and ultimately everywhere.